Local public goods and average cost pricing

Existence of a compensated Tiebout equilibrium is proved for an economy with a measure space of consumers. This result is then extended to show the existence of equilibrium for an economy with natural monopolies and contestable markets.     

Implementation of the SutteARIMA method to predict short-term cases of stock market and COVID-19 pandemic in USA

Quality & Quantity - The objective of this study is to compare the different methods which are effective in predicting data of the short-term effect of COVID-19 confirmed cases and DJI closed...     

An optimal auction for capacity constrained bidders: a network perspective

This paper examines the problem of a seller with limited supply selling to a group of agents whose private information is two-dimensional. Each agent has a constant marginal value for the good up to some capacity, thereafter it is zero. Both the marginal value and the capacity are private information. We describe the revenue maximizing Bayesian incentive compatible auction for this environment. A novel feature of the analysis is an interpretation of an optimal auction design problem in terms of a linear program that is an instance of a parametric shortest path problem on a lattice. We thank the referees for a number of useful suggestions that have been incorporated into the paper. Mallesh Pai suggested the argument given in Lemma 1. The research was supported in part by the NSF grant ITR IIS-0121678.     

THE EVOLUTIONARY DYNAMICS OF FINANCIAL PRACTICES

This paper presents a model in which financial practices are chosen by decentralized units on the basis of expectations regarding financial market conditions, while the probability distribution governing market conditions itself depends on the choices made. If all agents are unboundedly rational, there is a unique equilibrium in which expectations are self-fulfilling. The assumption of universal unbounded rationality is relaxed by introducing an optimization cost, which leads to the possibility that optimizers may not have a sufficiently great evolutionary advantage to eliminate nonoptimizers entirely. In this case behavioral heterogeneity can persist even in the long run. For certain classes of probability distributions governing financial conditions, the evolutionary dynamics of population composition can help explain a number of stylized facts regarding the dynamics of financial practices which have hitherto been explained on the basis of learning dynamics or systematic cognitive biases.     

Texas Roundtable on: The Future of Graduate Business School Education

A small group of academics and practitioners discuss the challenges now facing today's business schools. First and foremost is the challenge now being mounted by “online” courses to the traditional methods of classroom lecture and discussion, supplemented in some cases by apprenticeships and other kinds of “experiential” learning. How will traditional universities burdened with high and rising fixed costs for buildings and faculty compete with very low‐cost competitors—programs that reportedly have enabled star lecturers to reach audiences that, in some cases, have exceeded 100,000 students? In assessing the seriousness of the challenge, the panelists start by attempting to articulate what is valuable in current business school education—valuable enough to enable the best business schools to command as much as $175,000 for two‐year (or shorter) programs that confer MBAs. Much of the discussion focuses on establishing the relative importance of the disciplines, or body of knowledge, that are taught in business schools, as compared to the development of “collaborative” habits and interpersonal skills aimed at enabling students to make more effective use of their knowledge within large organizations. Some of the panelists, notably Jeff Sandefer, founder of the (now ten‐year old) Acton School of Business, argue that far too much of today's business school curriculum is devoted to the classroom and conventional learning. And many of the changes in the top business schools during the past decade appear to reflect Sandefer's charges. But, to the extent there is a consensus among the other panelists, it is that the best business schools will continue to try to accomplish both of these goals, though with varying degrees of effectiveness, while most schools attempt to maintain their specialized capabilities, and carve out distinctive niches based on them. For some schools, such specialization is likely to mean continued emphasis on theory and classroom learning—though almost certainly with more attention to practical application and collaborative decision‐making. For other schools, the main focus will continue to be the development of general management and leadership skills.     

The impact of cultural differences in U.S. business-to-business export marketing channel strategic alliances

Given slower growth and fierce competition in the domestic market, combined with increasing opportunities in many overseas markets, more and more U.S. companies are going international. While many doing so may initially use a direct exporting approach that relies on foreign channel members to distribute the product in the host country, over time, strategic alliances among distribution partners may form based on trust, commitment, and cooperation. For these alliances to succeed, the partners' perceptions of these variables need to be congruent so that expectations on each side of the dyad are reasonably similar. However, what happens when the cultural backgrounds of each channel partner are substantially different? This study empirically examines whether cultural differences do affect trust, commitment, and cooperation in international marketing channel alliances between U.S. exporters and their foreign distribution partners. Based on the survey responses from 149 U.S. exporters with marketing alliances abroad, cultural differences do affect trust, commitment, and cooperation. The greater the cultural differences between channel partners, the lower the levels of trust, commitment, and cooperation. Managerial implications are discussed, and study limitations are identified.     

Knowledge management and innovation strategy: The challenge for latecomers in emerging economies

The success of latecomer firms from the emerging economies challenges the conventional wisdom on entry timing and resource-based competence. Building on research on institutions in emerging economies and the resource-based perspective in strategic management, we propose a model to explain how resource poor latecomer firms in emerging economies catch up with the multinational incumbents. We classify latecomers based on their strategic learning intent as either emulators or blind imitators. The strategic learning intent depends on a firm’s complementary assets and its absorptive capacity. Firms that choose emulation develop flexible routines, while firms that choose blind imitation end up with rigid routines. Over time, when there is a need for resource renewal, firms that have flexible routines are better positioned to respond. We take the Chinese mobile phone industry as an exemplar to illustrate the core issues in latecomer catching up of emerging economy firms.